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News/Business. Becky Quick, Joe Kernen, Andrew Ross Sorkin. Business news and talk as the trading day unfolds on Wall Street. New. (CC)

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03:00:00

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TOPIC FREQUENCY

Us 34, Sandy 22, New York 11, Joe 11, Becky 8, Manhattan 8, Adp 7, Austan 7, U.s. 7, Obama 6, Fema 6, Zandi 5, Glenn Hubbard 5, Charles Schwab 5, S&p 5, France 5, New Jersey 5, Mark Zandi 4, Willis 4, Jim 4,
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  CNBC    Squawk Box    News/Business. Becky Quick, Joe Kernen, Andrew Ross Sorkin.  
   Business news and talk as the trading day unfolds on Wall...  

    November 2, 2012
    6:00 - 9:00am EDT  

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kernen and andrew ross sorkin. and the weather shortened week on wall street which seems like the longest week ever is about to end with some heavy duty data. the october jobs report. and economists at this point are expecting nonfarm payrolls to come in at 125,000. the unemployment rate is seen ticking up to 7.9% from 7.8% a month ago. of course cnbc will have that report live from the labor department at 8:30 eastern time. and we'll be slicing and dicing the jobs report and the economy with our guest host, mark zandi. also at 8:00, the former chairman of the council of economic advisers austan goolsbee will join us for the report. and then we'll get reaction from the romney campaign with ron hubbard. that's at 8:40 eastern time. obviously a lot on our plates today. andrew, i'll send it over to you. >> the coast guard opening the port of new york new jersey on a restricted basis today allowing the backlog of barges containing
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gasoline and fuel into the area for the first time. how soon, however, will we see relief in the area impacted by sandy? that's the big question this morning. joe knows this very well, on my way in today, i had to take a taxicab for $125 because jeeves was this line to get gas, he was out of gas. >> i tried to take a car, my guy who i call -- he is not, but he nights as well be a former -- he has never failed. on on tuesday he came. and there have been snowstorms in the past where we've gone off the road, around, jack moved tractor trailers to get here's couldn't get gas. and so then i had to use -- i had a certain amount left in reserve. my gas tank is locked because people are siphoning now. >> it happened to one of our
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producers. >> there are people with guns. first 12 lines have to to do with troopers being there, you're not getting gas, people pulling guns, fights, frustrated. i saw something, and mill burn is a pretty of a through event community. and this one gas station finally got power, in addition to a five hour wait for cars on the other side, there were people, i don't know, somehow reminded of almost leak refugees. probably 120 people all with gas cans and three across going back maybe 80 all waiting for gas cans. >> for their generators trying to keep the power running. and we were talking about it this morning. will is what starts to happen. nerves are frayed, people ared cold, the weather's dropped down to 40s. >> what happens when it's the ground beef? the country looks at us and they're like what are you -- >> we're totally overplaying this. but yesterday 80% of the gas stations in new jersey were shut
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and in this area probably more like 95%. >> and 90% of the areas out in parts of new jersey, 90% probably have no power. and people are cold and it's getting old not having -- you know, where do you cook? restaurants aren't open. >> there was an applebee's open. >> i got a pizza from a place. >> the the upper west side is like an oasis minus the cats at the moment. >> are you expecting more trouble where you'll need additional insulation? >> the sweater is back. sweater of the honestmonth. >> is it because it's a friday? >> a little bit of a friday, but
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i was running around the streets this morning trying to hail a taxi. >> but you didn't put it on until you got here. >> no, i had it on and then i took it off because i was trying to put my tie on. >> and his shirt wasn't buttoned. >> was the barn door open, too? >> let's get kate kelly's thoughts. she's out reporting on what's going on. kate. >> the new york harbor sitting right behind me, this slim can elf water is normally about the third busiest port in the nafgs. we are nearly a million barrels per day. but that was until hurricane sandy, of course. in the aftermath of the storm, the coast guard shut down the water way to boat traffic in an effort to keep people safe. and now to assess the storm's damage. that is until yesterday. late that day, partly at the
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behest of senator schumer, the coast guard agreed to reopen the port to fuel bearing craft. the move was designed to help gas strapped consumers, airlines and businesses to get back on the roads and in the skies. gas industry officials say it should make a difference. the storiage terminals have been hard hit by the storm and some will require weeks of water removal and equipment work to get back into operation. but others could be ready within days they need terminals to at that time the finished product off of their hand so is that they can load up fresh supplies and keep going. still, it's likely to be a long road at the east coast gas and oil infrastructure rebuilds after the storm. some an lis including goldman sachs say demand in a case like this is likely to surge in the
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aftermath of an event like a storm that takes a lot of mass transit off line so that people are using private automobiles. at the same time, however, we have a big lack of supply that could drive prices up. so a potentially nerve-racking couple of weeks as well as at the gas lines whereas people are getting angry and even violent. >> if they get power back up for some of the stations, i would assume that would alleviate some of the concerns. will it be better in a day or two? >>ic th ii i think that may be thinking although will are signs of progress. yesterday i spent a day at a balterred terminal, being the storage hub for refined products that then go on to trucks and pipelines that take the supply to airplanes. there is some sign of hope on the terminals today because they can now get their supplies on to
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barges and other ships. but in many cases they're still not ready to operate because they've been flooded, they have debris, it's not even safe. so there are a couple of reopenings in progress, 24 to 48 hours from now. i think you are right that within the next couple of days we'll see some signs of life, but it's really not enough at this point to kind of fuel the whole area in any way that we're used to. i think priority will go to airports, priority will go to the neediest. we know hospitals have had to move people around. so obviously emergency vehicle and things like that. but it may be tough for compu commuters. >> next week is the earlier? >> the good news is friday and maybe after today people won't be trying to get anywhere. maybe if you can just hack out hang at home. >> you but people immediate their wanks. they have to get to work and especially those with private you sauautomobiles are going to lacking gas. >> it looks like a christmas
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shop. i feel like saying merry christmas. it looks like snow behind you. and you have red scarf on. what did you buy me? doesn't it sort of like like the season? it's not there yet. we have a few things to focus on. but it's almost there. it all starts with gas and then people are waiting in line for ground beef. >> i heard news morning about a queens gas station where there was a long line and one person pulled a gun on another. it's getting very scary. >> like everything else, you know, for my handgun, i'm late. i'm late on it. >> i don't know if we should mention this, what about atm
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machines? >> some places are only takes cash right now. so if you -- >> also the trucks that bring the cash to the banks, they may have a hard time getting cash. >> i practice it to the atm already. >> the company i spent time with yesterday actually had a cash issue. their home office in san antonio wired money to the philly area to a bank so that they could provide petty cash for workers in this area who are facing shut down atms, lack of gas for their cars and so on. so some companies are having to go to extraordinary measures. >> and if you move outside this immediate area, even an hour away, an hour and a half away, you get back to a normal thing that if you needed to mike a run for gas, you could maybe go out to the delaware -- >> what really scares me is the solar flare or terrorism or something that shuts down the
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grid for six months. >> did you see the cover on on the new york "post"? the marathon controversy. an bufs power. >> i saw bloomberg can't outdo himself, but -- >> the endorsement based on climate change. >> that and just the absolute power how many times does he fly miss jet in what is the size of his government footprint? but he needs on to be able to do that to keep the rest of us in line doing the right things. drinking the 16 ounce or less sugary sodas. anyway, go made. >> let's get a preview of today's jobs report. joining us right now from new york is the chief economist of
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fao economics. also from chicago, we have lou graves. good morning to both of you. lou, i think you're looking for a lower number than economists consensus. why are you looking for a lower number? >> one is a shift in what i see the local government education sector. >> war of the words. sorry. i don't know why my mike is open. >> but we've seen a shift into august for that sector. the hiring for that sector in august and september was the highest in the 57 year history that they've been following that. so if the other adjust the number this month only brings it up to the averages of the next few years, i think we can get a decline of, say, 25,000 in that sector. so that's why i think the government will be weaker than the private secretary it tore. but as far as the private sector goes, the employment components
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of the ism, the empire state, the fed and chicago purchasing managers in-dek were all lower in october than they were the month before. the philly fed and chicago indexes employment components were the lowest since late '09. and interestingly for the first time since late '09, in the chicago index, the respondents saying they had fewer employees, 25 3rs, was more than those that said they had more employees. and that was the highest since late '0 #. >> bob, what number are you looking for? in i'm looking for 125,000. i think the manufacturing surveys have been weak, but remember, you compare them to last month and we're coming on of a number that had popped to some extent. we have had a recovery and of
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course what happens in every business cycle is manufacturing employment just gets smaller. the question is in the services secretary or. >> would you be surprised if the number came in higher or lower? >> we have the adp estimate and this new adp, i don't know what to do with it. we haven't seen it before, so it's untested. the old adp was saying job growth is getting better, so i guess we revamp the adp and now it's giving us the same message. so i kind of think there's still job growth brewing. consumer confidence, consumer sentiment, all of these indexes are moving up very strongly and there has to be a reason for it and the reason is probably jobs. >> in through the unemployment number will be key. do you expect that to go above 8% or stay back closer to 7.9%? >> i think it's more likely to go up than to go down.
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the one thing is the household survey where we get the unemployment report. and that number doesn't get adjusted. until you get a benchmark revision later on. so that won't change. i would say it's more likely to go up than to go down. interestingly, as far as bob says, the sentiment index for the consumer has been up. i think that part of that may have been the drop to 7.8. but interestingly the business sentiment is not very good. on your air, larry fink was saying that because of the uncertainty over the fiscal cliff, businesses are delaying hiring. and that's also what the cpo of u.p.s. said during his conference call. and he focused on the medium and small sized businesses saying that they're not spending, they're not stocking inventorieses and not hiring because of the fiscal cliff uncertainty.
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>> bob, that's an interesting point just in terms of of the fiscal cliff and the uncertainty. do you expect on to see that in the next couple of months? >> we'll have to come face to face with it pretty soon. we'll have to deal with the fiscal cliff and we're all assuming there will be some menlding there. the thing i'm worried about is with this storm effect, whether people have lost enough wealth that there are people who really weren't working that they'll feel that they have to go back and rebuild the wealth that they lost. if that happen, you could seat unemployment rate going up because people who thought that they didn't have to work now will have to go back and look for jobs. >> that's an interesting point, too. gentlemen, i want to thank you very much. and bob usually you're here on the set on these mornings could you for the get a car from morning? >> yeah, you couldn't get a car for me and i tried to get a taxi and i'm in the same area that
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andrew does. it is an oasis compared to what else is going on, but there were no taxis. and it took the subway a long time to get there. but the subway is free, so i got a free trip here. >> but if you have money, you can get a taxi. andrew just -- >> i kept bidding up the rice. >> and you're just a working man, bob. hard working economist. >> i wasn't in the bidding process. >> i think the tax city probably stopped and looked at that sweater and said this guy has cash. this guy has money and -- >> the first four cabs must have thought i didn't because they went right by me. i'd say i'm going to jersey just across the bridge and they would say nope. >> i had a suit on. >> no, but this -- this is not just a sweater. that's like an $800 number or -- >> no. >> i know fashion, too, i just can't afford it. anyway, theres. >> thank you, guy. we appreciate it. >> thank you.
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>> some don't have zippers on them. >> time for the global markets report. kelly evans is standing by and london. kelly, what have you got today? >> as you've been discussing, the johns report, basically traders are on hold waiting for that release anne frankly, it's not even the jobs report today, it's the election tuesday. it's a lot of the eurozone meetings coming up which really have their attention and has people a little bit nervous about making big news. so europe stoxx 600 up about 0.2%. quick look at the major bourses. you'll see they're actually for the most part to the down side, roughly flat. ibex 35 showing gains. ftse fractionally higher. we did get some data out today. pmis across the eurozone area. the composite came in okay, but greece and spain manufacturing sectors continues to to shrink.
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that's one reason we're'sing the euro trade weaker. but very important issue. as of today, short sellers with more than 0.2% position in any european company have to report to regulators. and if they have more than 0.5% position, it will be made public. this is highly unusual. teams of lawyers were working in to the night last night making sure they could meet all the disclosure requirements. because of course in typical european fashion, not just one central regulator they have to report to, but each affected. so this isn't an easy one for people to wade through. but the bottom line starting today, we're going to get the releases saying which position,
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which position have a short position in some of these big names. there could be volatility in those stocks which for example might have big disclosures on that front. al came tell lieu sent were out with weak earning. but they're one of the biggest shorts in france. disclosures will start today, but going forward, anytime anyone hits that threshold and it moves by one tenth of a percent in either direction, there will be a release. so a huge experiment. and something certainly to copy an eye on over here. back to you. >> okay on, kelly, thanks for that. coming up, is the east coast in for more bad weather? we'll get the forecast next. and by the way, it doesn't look good. and don't look now, but the ipad mini about to hit the stores. that story coming up right after this. tdd#: 1-800-345-2550 let's talk about low-cost investing. tdd#: 1-800-345-2550 at schwab, we're committed to offering you tdd#: 1-800-345-2550 low-cost investment options-- tdd#: 1-800-345-2550 like our exchange traded funds, or etfs tdd#: 1-800-345-2550 which now have the lowest tdd#: 1-800-345-2550 operating expenses
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. welcome back to squawk. it take a look at futures ahead of the number. a lot probably going to change over the next couple hours. the other big corporate story, the ipad mini hitting stores in two dozen countries today. though we should note already lines across asia have been smaller than with previous product launches. several new york area apple stores will be closed today because they don't don't have power due to hurricane sandy. the ipad mini starts at $329 for
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a wi-fi only version. that's more expensive than the kindle fire and google nexus. >> making things a little smaller or bigger, it's really not like -- you know what i mean? >> i like it. >> you can't do again. you can't say i'm going to make it just a little bit bigger. friday the 13th back from the dead, friday the 13th 12, by then you've been to -- and then the other thing, the famous something about mary, i'm going to introduce a new workout video called seven minute abs. and the guy says there's already an eight minute abs. he says you can't get a real
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burn with six minutes. and just that reaction nael, sooner other later -- >> there's a view that the mini will cannibalize the sales of the larger ipad whiches has higher margins. >> i'm using six minute abs. when i was using the seven, it was much -- it was a six pack. >> didn't we have an analyst who came in and said didn't do you something? >> tough act to follow. >> i'm worried about something across the thap blows you away. >> carl icahn would like him to buy netflix. >> the best thing i've heard is gas buddy. i could use a gas buddy right now. tells me where it is and where the lines are not long.
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is the east coast about to get hit from another storm in let's get the forecast from the weather channel. >> i have the incorrect graphics up behind me, so i do apologize for that. my director is certainly trying to keep tabses on it. as we take a look at what because happening with sandy's track, obviously it has been an incredibly long week since we saw the system officially making landfall. that was in the u.s. as of 8:00 p.m. on on monday october the 29th. we originally saw previous landfall. as we progress into the northeast for today, light snowfall and rain for today. but the bigger concern is what's happening with the system that will be diving across the country. it's going to take a nose dive south of the system that's actually produce rain and snow across the dakotas. it will eventually take a nose dive south. and what that will do, there we
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go, here's a look at some of our spotty showers as well as our snowfall. again, a little bit of being a tip weather still knocking on the door of the northwest. here's a look at that system that i was telling you about. again, that will produce 1 to 4 inches of snow into portions of the dakotas as well as knocking on the door of northwestern minnesota. our storm system once it does track a little further east on sunday, things getting a difference from southeastern texas all the way up in to north carolina. now, as for those of you who are keeping tabs again on the weather across the middle east, the bitterly cold temperatures as we go through this weekend into early next week, it's those overnight lows which are taking a dip down. so right now you're looking at the highs in the 40s, but by morning, temperatures hovering around 30. and we'll have to see if this particular system kicks out and then makes a wind back towards the northeast. so we could have a potential nor'easter on our hands. i know it's the last hinge people want to hear, but we do want you to be prepared for that
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possibility. back to you. >> so we would probably not know at this point until sunday if it's really going to make that turn? >> things are shaping up to be in line for some sort of system happening in the northeast particularly looking closer towards late tuesday. where specifically in the northeast that we could see this happen, we're still having to keep tabs on those models. as soon as we know, you will know. >> danielle, thank you very much. when we cokcome back, we'll talk about trading off the jobs report or waiting for the election. we'll head to the trading pits. and putting a price on sandy. we'll talk to a long time insurance executive to get perspective on how the industry will handle all the damages and how you can even start to tally up the cost of all of this. right now as we head to a break, take a look at yesterday's winners and losers.
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welcome back to "squawk b " box." we're two hours away from the release of the jobs report for october. economists are expecting nonfarm payroll to come in at 125,000. the unemployment rate, and that was at 8.1, then 7.8 on 140,000, which is very strange. >> but it's a different survey. >> but like what they said yesterday, but to bring it down
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like that, you need 150,000. so the guy made the point yesterday, we came down from 10.5 or whatever it was to 7.8. and i remember very few under 50,000. >> people falling out of the workforce either because they had given up hope of finding a job or retiring. >> right. that's what it is. and we'll see whether -- i'd be shocked if it doesn't go down again today. i'd be shocked. anyway, cnbc will have that report live from the labor department at 8:30 a.m. we'll have instant reaction from one of the romney camp's top exec advisers. >> could be the treasury secretary or the fed chairman. >> the road to recovery from sandy is going to be a long one for some. courtney reagan joining us with some of the sandy recovery stats about and were you late this morning? i saw you were rolling in
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here -- >> yeah. >> you're living this story, as well? >> yes, with the gas shortages, there's lots of traffic and car jams and car backups. and it doesn't matter how early you get up it seems like you're late anyway. >> if you ever no gas, doesn't matter. and i thought about that. maybe at 4:00 a.m., you can get gas. there were people waiting in line at closed gas stations and i looked and i saw smoke coming out of their -- people sitting there in the dark like waiting. >> somes today stations don't have gas or power and the people will be in for a rude awakening at the: 9:00 a.m. shows up. >> it's a concern that we all pay attention to and weather will get colder on the east coast this weekend, so this is a concern. and that will make life much tougher for the 4.5 million customers still without power. new jersey remains the hardest
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hit state. we're nearly 43% of customers remain in the dark. drivers battling two hour lines and gas shortages. one bright spot, con edison saying most of manhattan residents will have their power restored by saturday commuters can expect more traffic jams again today as the hov restrictions are still in place. holland tunnel is open, but only to buses. the mta also getting more service in the subways bag up and running today. and northeast corridor only train running in from new jersey. so it will take time. >> courtney, thanks. don't leave because we'll talk about the true cost of sandy. what will it be for insurers and what about on the economy? two different things to think about. joining us now to answer these questions and give us his take on the insurance industry's response, chairman and ceo of
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lewis group holding. did you hear? that was a big build up. i said you'll tell us how much it cost the industry insurance and how much it cost the economy. so i hope you have your calculator with you. >> i don't, joe. good morning to you. i don't have my calculatocalcul. if i knew all those answers the markets would open differently today. >> we oversell and underdeliver sometimes. but we want people to watch. do you think at this point compared to, i don't know, compared to an irene or -- what's the overall number that you're working with at this point? >> what happens is after there's a catastrophe, there's lots of different kinds of companies that come up with estimates. and estimates are usually low right after the catastrophe and then they tend to grow. but the first estimates was in the economic loss area of 10 to 20 billion. and the insured losses it in the 5 to 10 billion range as an
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average. and then every day it's crept up. in the united states, there's been more people ensured than in other parts of the world. so there's a narrow gap between economic loss and insured loss. so this morning i saw the "new york times" suggest that the economic losses are now at 50 billion which would mean that the insured losses are not far behind. probably in the 30 to 50 billion range. and as time goes on, that number will probably go up because what happens is that you start to find things that you didn't see before after you start to clean up the debris and you start to see business interruption and environmental contamination and all those sorts of things. so this is a big deal. and if $50 billion is the right number as it relates to the gdp and its effect on the economy, you'll probably talk 50 biasis
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points. >> this year? >> yeah, when? you add and then subtract and you have to do a lot of-of-i think so you need to do a second or third derivative to feebd out net-net what it actually does to the economy. >> it does have a big impact, though. because back to katrina for example. that was $75 billion of insured losses. which meant that the economic losses were over $100 billion. so usual talking a very big deal here. companies start to assess how much the business was disrupted. accessibility to their business. the ability of their employees to come to work. you don't start to see contamination issues and environmental issues until later on.
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but it's unfortunate to say and you asked me a very valid question, it's unfortunate to say that i think this number could be very big. >> the other question is who pays for all of this because the flooding, a lot of this will go to the national flood insurance program. but at some point, who ends up picking up the tab. >> i think mostly the insurance companies, becky. there's three sources of ways to fund catastrophes. you have the national flood insurance program as you mentioned, but that's under fema. fema stands for federal emergency management agency. and that's basically a response mechanism and i think they're doing a great job of responding, but it's not a funding mechanism. i heard they had $5 billion, $7 billion. yesterday the director said that they had $3 billion. but fema is not a funding
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mechanism for repairs. to rebuilding people's lives. so you have to understand that that's what fema does. the other obviously is the insurance industry which for the most part if you look at all of these catastrophes including katrina and you look at irene most has refunded the rebuilding of the world trade center has come from the insurance industry. >> i'm thinking about the mta. apparently it's costing the mta $18 million a day just in lost fares let alone whatever it's cost them to pump all this water out. is that covered by insurance? >> yes, in some cases it is. everybody has different kinds of -- andrew, everybody has different kinds of insurance. the wordings in the contracts are different. it could come under business
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interruption, it could come under service interruption. there's a different paragraph for service interruption. i would doubt whether the mta giving people a pass for fry comes under that squur ris diks. it's a great thing that they're doing, but again there's another interesting angle with regard to insurance, what the contract reads and how it pays out. and all of this is going to play out over a longer period of time. that's why he said earlier that these things tend to grow as time goes on. >> all right, joe. thanks. we finally got to you today. i know we wanted to try to get to you yesterday. >> i apologize for that. thank you again for having me today. >> you're very welcome. thanks for coming on and explaining all that to us. from willis. what you talking about, willis. >> a different willis. this is still on the air. >> you're right. thanks, joe. >> i loved different strokes. oh, my god.
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mr. drummond? love it. >> i don't know him. all i know is what you talking about willis. >> we have to go to break. comments, questions about anything you see here, including different vostrokes, squawk at cnbc da cnbc.com. still ahead, are more investors sticking to the sidelines to wait for the election? that discussion right after the break. governor of getting it done. you know how to dance... with a deadline. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. this is awesome. [ male announcer ] yes, it is, business pro. yes, it is. go national. go like a pro.
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we're counting down to the jobs report. or is everyone just waiting for
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the election? that's the question. he's making mooing noises. >> every time. >> scott, what's the answer to that question, are people waiting for the election or are they waiting for the number? >> nell's wait for the election and the fiscal cliff. i don't think this number will be a big mover because i don't think it will be off center really big either way this morning. but what the traders talk about down here is we have an unprecedented situation on our hands. there are only three things that we can trade. fixed income, equities and commodities. and all three are very high prices. fixed income is high prices because they trade at an inverse interest rate. equities, central bank buying. equities are fairly high. commodities, big commodities rallies as of late. so the three things that we trade at all very high levels and it's difficult with the uncertainty and fiscal cliff to embark on six or 12 organization 18 month buying programs. >> how are people setting themselves up ahead of tuesday?
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>> most of the cash is on the sidelines. the problem is how much is either one of those guy going to unleash. so i think the market psychologically with like to see a romney win, but even if it's obama, we can still make a plan. and that's the biggest problem. >> what happens if we don't find out the outcome of the election by wednesday morning? >> that's the talk of the town right now. downstairs everybody's talking that is the biggest disaster because if he with have that uncertainty continue -- i don't think it would go as lon at figure cal cliphysical kal clif that's the irs volumes have been low because we ecause there is no etting plan going forward. >> scott, we'll leave it there, but thanking for your perspective. we'll see you soon. the question on our minds here this morning, to run or not to run.
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that is our question. the big controversy over mayor bloomberg's decision to push forward with the marathon. one topic of outrage to touch on in chairs this morning. smart comes with 8 airbags, 3 a crash management system and the world's only tridion safety cell which can withstand over three and a half tons. small in size. big on safety.
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horrible. wow. we're in "chairs." i have mixed feelings on what we're going to talk about, the cover of -- so it says that, you know, we're going to have a marathon tent where they're using power while a lot of people are without power. i have mixed feelings on all this. there's something about a marathon and the resiliency of a city and let's go forward with this even though there's things happening around you. >> i had mixed feelings. >> like the baseball game after 9/11. >> i had mixed feelings until i create facebook page written by staten island residents, this is a sin to have a marathon taking place that kicks off and starts a mile from where we are still looking for bodies. you are donating water, food, socks, all of the runners coming in and those are the items we need. >> it's a resource issue. >> okay, but take it to the next level in terms of government resources, with as many people
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hungry and living in poverty as we have, do you ever go into space, do you ever do anything where you're trying -- >> no, but this is a one-off circumstan circumstance. >> you have a baseball game after 9/11, after the earthquake in san francisco, did they finally finish it in. >> i think they did. >> this is one of the issues where mankind there are survival issues and things that take us, arts, take us above. >> i was on that until i started reading. >> i love to criticize bloomberg but in this case -- i've been criticizing him -- >> if i thought there was enough resource force everybody to go around, given what's happened i would be all for it. the law enforcement, nose issue. so much law enforcement has to be devoted to the marathon. >> the gas lines there have been looting in coney island and other places. >> with bloomberg the decisions
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he's making, starting to remind me of like, i don't know, a mubarak or somebody who has been in power for too long and just whatever he thinks, he doesn't even think about it for that long before he says this is the way it's going to be. the soda thing was ridiculous. >> his decisiveness made people like him. no dithering around. >> how about you change the rules. >> he was reelected. >> i know that. >> so was chavez and castro. there's a lot of people. >> we've had him on our own show if he ran for president they'd love to vote for him, a lot of people in the business community. >> he supposedly looked into the run and chose not to run. >> he's not a republican. he's barely an independent. >> he's new york city. >> he just endorsed obama. but to say i'm endorsing obama because of sandy and climate change it's totally
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irresponsible. the intergovernmental panel, blah, blah, blah, on climate, they would never tie a single event to try to do that. it's ludicrous, it's embarrassing for him to do that. it's just clearly to me anyway i think he's jumped the shark with the 16 ounce but you go back again with the third term. i thought he was going to run for a third term so he might come back, too. >> when we return we'll talk more about the road to recovery. for some it's waiting for hours in line for gasoline to keep their cars and generators running. we'll talk to one observer the potential crisis the east coast could have growing right now. as we inch closer to the october jobs report mark zandi will join us for the countdown as our guest host for two hours today. "squawk box" returns after this message.
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the countdown is on. it's the final employment report before the election, and we are on the job. get the pick from our experts on what the numbers could mean for your financial future. the wait to fill up. former shell buff john hoff heister tells us when he expects the gas shortage in the northeast should end. plus a checkup on health care, the president and ceo of cigna on what his company is planning after next tuesday's election. the second hour of "squawk box" starts right now.
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>> good morning and welcome to "squawk box" here on cnbc. i'm andrew ross sorkin along with joe kernen and becky quick. take a look at futures ahead of the jobs number this morning, pretty much virtually across the board, dow would open five points off, nasdaq up five points and the s&p 500 virtually nil but this is likely to change. it is jobs friday. the government plans to release the october data coming up at 8:30 a.m. eastern time. economists estimate the economy gaining 125,000 jobs and the unemployment rate remains just below 8% at 7.9%. the ipad minnie and newest version of the ipad go on sale today. several apple stores in new york will remain closed due to superstorm sandy, soho, 14th street and grand central station. in asia, we were talking about in the last hour they're not selling those things as fast as they thought. aig swinging to a third quarter profit, beating forecasts after
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posting a nearly $4 billion net loss a year ago. the company saw improvements across all of its insurance businesses. the ceo telling maria bartiromo it's too early to estimate the financial impact of the storm. >> the coast guard opening the port of new york and new jersey on restricted basis allowing the backlog of barges containing relief supplies and oil. kelly, this week or next week, if i can get home today i can hold out 'til next week maybe. will it be okay? >> reporter: joe i think you'll see some incremental relief but you may still find yourself in a fuel line and i think it could be a week to two before we feel real wide seed relief. you can see the port of new york and new jersey behind me, sunrise coming up in a few minutes and it should see a little bit more action this morning, based on a coast guard
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lifting of the ban on boat traffic that was imposed last saturday night in anticipation of hurricane sandy. under pressure from lawmakers yesterday, notably new york center senator chucker who was concerned about long gas lines which are leading to frayed nerves and threats of violence overnight new york harbor has reopened to boats and banks carrying fuel supplies as you mentioned. gas storage terminals that weren't too badly damaged by the storm such as a handful of kinder morgan sites who operate two terminals in new jersey and one in staten island can load diesel and unleaded fuel on to boats bound for the city and up the hudson hopefully easing some of the supply pressures we've been talking about. new jersey governor chris christie lifted a ban on out of state fuel purchases yesterday, that should remove one piece of red tape at least and importantly a large section of line number three of the colonial pipeline which brings jet and auto fuel to the city was restarted around 9:00 p.m.
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last night, that's a crucial piece because that was causing another chokehold on supplies. still these troubles are likely to persist until a greater percentage of the area's terminals, refineries and pipelines are back in full operation, you guys. yesterday as a 5 million barrel terminal operator in linden told me he was not able to get his marine terminal back in order for another four to six weeks. at the same time he's laboring today with the help of a backup generator to get at least one if not two truck racks open for use by noon, the trucks can resupply their tanks and bring them to gas stations so joe maybe it will come to your neck of the woods within the next week, we hope. >> we got the double whammy because most gas stations don't have power. they have gas. >> that makes you think if they get the power back up and running it will make it a better situation. >> the substations have to be
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fixed first and then they have to deal with the individual places where the lines are down. >> my guess will be gas stations will be high on the priority after police stations, hospitals and those. >> reporter: i don't know the exact order but i think you're on to something there in terms of the order of priority. yesterday the linden site i was visiting they are right next to the linden sewage plant, so they're on the same grid so as you get the second and third priority power users back online, others who are in their neighborhood are going to benefit so we'll see some incremental progress there, too. >> it's something we are certainly all hoping for. kate, thank you stretch. we'll check back in with you in a little bit. the other huge story we're following this morning is the jobs report. there have been 45 monthly jobs reports since barack obama was inaugurated president. number 46, that is today, potentially could be the biggest of them all. cnbc's steve liesman is here and has a preview of the numbers and
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steve, what are we looking for? >> the most important jobs report in history perhaps. >> you think? >> i think that's what some people are calling it. we'll look at the obama jobs record in a second. let's focus on the october report. 125 is the number expected, 7.9%, a tick up in the unemployment rate, not giving back the gains. >> the 7.9 that would be the round trip, that would be january 20th. >> the number whenby ma took office. >> i thought it was 7.9. it went below? >> 7.9. >> so 7.9. >> it went up and down. i have the obama jobs record for democrats, republicans and economists, and you'll have a lot to say. >> no, i won't have anything to say. i'm saying it would be weird the symmetry of 46 months above and to end on where the day you took office. >> the consensus for this morning is taking a lot of cross
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currents in the data, with the business side of the data suggesting a weak employment report but consumers acting and talking like jobs are plentiful. capital spending influences my thinking about this morning's number, regional fed surveys down and layoff announcements up just a bit. jobless cuts consistent with the 125 to 150. conference boards gauge of jobs plentiful on the upside overall sentiment up and adp, economists don't know what to do with the new methodology but in general on the plus side for jobs. one of the biggest worries is what's happened to capital spending over the last several years. look to the right of your screen the way those two diverge there, turned negative in june on a year over year basis but there's been little reaction in job growth. finally and i think we have these, here are a couple of ways you can look at the obama jobs record. this report if positive would
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put him over the top there, payrolls 320, i'm adding in, mark, do you think this is correct, benchmark revisions. >> you added it in. >> that's the way republicans would look at it. then you could say you no he what? the democrats might say this it's fair to exclude the first three months where there was substantial job declines so there's 2.6 million on the plus side if you take the first three months out and economists would say i don't really care about when he took office. look at the cycle. from february '09 through september of 2010 which was the trough it was down, the unemployment rate rose 1.7% during that period of time when the unemployment peak and from the peak to tooled it's been down 2.2 percentage points. presidents don't have as much as the political class thinks has to do with job growth and that's three different ways to look at it. you guys can pick any numbers you like.
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>> what do you think? >> it depends on who you are about whether you either give credit to the president or jobs growth or blame him. would you say bush wasn't responsible for the job losses at the beginning of -- >> i pretty much would. >> no one -- bush is responsible for all the job losses. >> it depends on who you are and where you come from. look the general thinking is that the government, and this is what the fed believes, the government can set what is really the employment level, okay? this is the natural rate or the rate that is the right rate for the economy. they can say this economy can operate without inflation at a five percentage point unemployment rate and it's the fed's job given that background to get the unemployment back to or up to what that level is. >> what do you think is the level they think it could be now? >> that number has changed and i think it has a lot to do with the aging of the population and how many people are working. jim o'sullivan says he thinks
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that level is 100 tncht a month job growth. anything above that would bring down the unemployment rate. >> that's new. >> and so one way to think about this, joe, is what's happened. >> we need to lower our expectation. is austan goolsbee on today? >> he's here. >> no. the other day i didn't challenge him but he said because last month we had a really good jobs report, and he was fully just talking about the 8.1 to 7.8, pause no one would call 114 -- it was below expectations and no one would call 114,000 good but in our minds that was a really good jobs number somehow. today i think we go, today i think we go to 7.5. why are you laughing? i do. >> you know why i'm laughing. why are you acting like you don't know why i'm laughing. >> let me ask you this. do you really think it could go back to 8% today in. >> yeah, sure. >> oh, my god, there's no way.
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>> that's what i think, too. >> why do you think that? >> it's a weird one-off. >> it's a very volatile number. >> if it goes back to a number like 8.0, axle rolled's mustache would be shaved off. >> payroll survey is done as a result of 300,000 establishments or so. mark zandi's adp is more than that. the household number which gives us the employment report is 50,000 or 60,000 phone calls that are made. the sample is much smaller, it's much more volatile. >> remember if you had worked for an hour or something. >> you'll take off the sweater. >> you could say you've been babysitting for three hours and that counts. >> everybody wants to know if you're employed and it tells you -- >> that's why it's not as reliable as the other numbers. >> you can't say the government is hiding stuff because it provides all the information. >> i'm not. all i'm saying it's a volatile
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number and it wouldn't surprise me if it went back to 8%. >> do you remember austan's point about 2003 they started counting military. it underestimated the job losses during the recession but then unfortunately when the recovery was happening they went oh crap we're not getting any coming back because we already sort of cooked it on the way -- >> the best joke of all is the u6, the broad measure of labor stock something created by the clinton administration in order to convince greenspan not to raise rates so now it's been turned on another democratic administration many years later. >> 7.5 is mine. >> 7.5 is your number? >> i think it goes up. >> thank you, mr. liesman. we'll see what happens. it could go up. if you have comments or questions on what you see on "squawk," shoot us an e-mail squawk@cnbc.com is the address and follow us on twitte twitter @squawkcnbc is the handle. coming up next, jobs and the
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election, how will the state of the economy play out at the polls? "squawk" returns right after this. up your game. up the ante. and if you stumble, you get back up. up isn't easy, and we ought to know. we're in the business of up. everyday delta flies a quarter of million people while investing billions improving everything from booking to baggage claim. we're raising the bar on flying and tomorrow we will up it yet again. we create easy to use, powerful trading tools for all. look at these streaming charts! they're totally customizable and they let you visualize what might happen next. that's genius! strategies, chains, positions. we put 'em all on one screen! could we make placing a trade any easier? mmmm...could we? open an account today and get a free 13-month e ibd™ subscription when you call 1-888-280-0149 now. optionsxpress by charles schwab.
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welcome back to "squawk box" on this jobs friday. take a look at future as head of the numbers, these numbers likely to change based on the jobs number, dow looks like it would open up 5.5 points off and the nasdaq would be off and s&p 500 off slightly.
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the jobs report is coming out at 8:30 a.m. eastern. hear their thoughts on how this might impact next tuesday's election. we have jared bernstein, former economic adviser to vice president biden, good morning to you. >> good morning. >> we only have four days left. could this number either way actually change the game? i'll start with jim. >> well you know it's interesting, jared and i were talking about this in the green room at a time and i remember back to 192 when george h.w. bush, the first bush presidency was on the line, bill clinton was battling him, 1992. bush had a recession, jobs were not being created, but the last jobs number there was a downtick in unemployment, a good positive jobs number that came out with four days to go before the election, and no one knew about it. no one paid any attention to it.
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obviously one side spun it as a positive, one side spun it as a negative but people had already made their mind up. what's baked into the election the three people that are still undecided in the united states of america about this election are not waiting for the jobs number to come out this morning at 8:30 to make up their final decision. i think most everyone understands right now that the economy is not growing as fast as it could, we're not creating the jobs that we could and almost no number that comes out this morning is going to benefit the election at this point in time. >> jared, you agree with that? i'll also throw into the mix we've had a number of endorsements for different candidates over the past day or two and i think about bloomberg and "the economist" magazine, do they matter? >> i can't think they matter that much. i agree with jim up until his last few sentences. if there's anybody making their vote decision based on today's jobs report i urge them to reconsider their strategy
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because first of all the expectations are for basically steady as she goes and secondly, anything that's a big outlier, an upside surprise, downside surprise is by definition an outlier that will likely be revised away. debris with jim, i don't believe it's going to be that big a deal in shaping at all in shaping votes. >> jared we have a mayor that decided that he changed his at least decided his endorsement based on sandy, remember the first promise president obama made, too. >> i thought that was interesting. >> he said i'm going to heal the planet and lower the rise of the oceans, remember, in nt from of the pillars in germany. i guess we're back to thinking he can do that again. we have a mayor people hold up as a paragon of -- >> let me say where i disagree with jim. i don't think folks are looking at this economy and saying oh, the level of unemployment or the level of jobs is unsettling.
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it's not strong enough. i think they're looking at momentum and if you look at some of the key parts of the economy, consumer confidence, housing, autos, manufacturing, there you have movement in a direction that to me makes a lot of sense. >> jim you said this last time and i didn't have the numbers. but 2010 was below, what was it, 2010 was below 2009, 2011 was below 2010 gdp and 2012 is below 2011. >> i think the last part of that is incorrect. i think if you look, mark can tell me, but the last four quarters of gdp growth i believe are higher than the previous. >> now you're doing years. >> i want to go back to the endorsement segment. this was a one issue endorsement mostly. he talked about abortion and same-sex marriage. but the main point of this thing was -- >> ludicrous, scary. >> does that help the cause in. >> i think it's not just global
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warming or climate change. i also think that what you saw there with chris christie and the president was someone actually working for a government role of centralized federal government that is critical in disasters and under a romney/ryan administration they're going to slash away at that support. they talked about privatizing fema, block granting fema. if you're a mayor or governor that sounds nuts to you. >> hold on if you read through that endorsement it was not a ringing endorsement. if you looked at "the economist" endorsement of obama. it was not a ringing endorsement. >> it's still an endorsement. >> you can read it partially a guy who was sort of in the middle. >> i'm with becky. it's an endorsement, a 1-0 thing as far as the election is concerned. >> hey, jim, if there is a real outlier in the numbers, let's say the number comes down to 7.5 or something that i think people are not expecting, does the argument that we have last month about the credibility of these
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numbers come back and what does that do to the campaign? >> again, if you look back at historical situations that are similar, and i think 1992 the bush election with clinton is a good example of this. he got some really good news before the election, and it didn't affect the outcome so i don't think this has an election outcome and i agree with jared on most of it but again i disagree on this whole notion that people are looking at that percentage number. it's 16 million people out of work that they themselves are worried or their neighbors are worried that their job is next. that's what matters is the individual. >> we can look at -- >> we have mark zandi here. >> the one way it may matter we're coming full circle on the numbers, the unemployment rate is back where it was where president obama took office. the employment data level of employment is back.
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you see number articles making a point. >> what about the promise stimulus effect? it's not to that effect. it's perpetual. >> for what it's worth and i'm not really sure how much it's worth, political scientists have looked at this question and they've asked what affects election outcomes more, the level of variables or their movement and they conclusively decided it's the latter. it's momentum that matters and i totally agree with jim. it's not like people are saying oh, yes, the unemployment rate is seven point whatever. it's more they feel things are moving in the right direction. that really is what it is. >> are you going to the same media trainers that say you know in this hyperpartisan period that we're in, agree with each other once in a while. people will like you more and -- both you guys keep saying you agree with the other. >> joe, this is the problem with the green room.
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you put them in the green room. >> we're not going to have you on anymore if you sit there -- where did you have breakfast? >> this is about psychotherapy or something. you want people to fight all the time. >> you guys are in the green room, we're not going to invite you back! we have watkins coming up -- >> we have to solve the fiscal cliff, got to find ways to agree. >> get a room. >> jim and jared, we'll get you a room here on "squawk," you will be back. >> i'm glad you guys are finding common ground. it's a good thing. >> media training. ceo david cordani will talk to us about earnings and the election and checking the futures on this last trading day of a very long week for a lot of people in this area, the dow futures are down by about 7.5 points. s&p futures and the nasdaq are slightly higher. "squawk" will be right back. from currency trading for a few
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let's get an update on the impact of sandy. cnbc's courtney reagan has the latest details. good morning again. >> good morning again to you joe. damage estimates from sandy get higher. the superstorm could cost as much as $50 billion and wouldn't be surprising to see that figure go up as the northeast regains power and digs out of rubble and we get back on our feet. the weather is going to get a lot colder along the east coast this weekend, not great news and that will make life tougher for the 4.5 million customers without power. new jersey remains the hardest hit state where nearly 43% of customers remain in the dark. the outages adding to the pressure at the pump where drivers are battling two-hour lines and gas shortages. one bright spot, con edison says most manhattan residents will have their power restored saturday. >> thousands of people in brooklyn waiting hours to catch a bus to cross the river to
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manhatt manhattan. in new jersey drivers braved traffic jams that stretched miles. many turned away if they didn't have at least three people in the car, despite waiting for hours to get into the city. commuters can expect more of the same again today as hov restrictions are still in place. mass transit is starting to make some slow but s progress. one tube of the holland tunnel is open this morning but only to buses. the mta is also getting more subway service up and running today, i rode it for the first time again yesterday and heavily traveled northeast corridor is the only new jersey transit line running into new york city from new jersey. health care a major concern in the aftermath of sandy, "squawk box" and the ceo of cigna will be back after the quick break. at optionsxpress we're all about options trading.
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welcome back to "squawk box" everyone. we are just an hour away from the jobs report for october. it's a big number. the markets are waiting for it and so are we. we will have that number for you as they hit the wires and give you instant reaction as well. look at futures ahead of that, there has not been a lot of movement probably as people are waiting to see what the number looks like.
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nasdaq futures up by 4.5 points and s&p up by just over a point. are people waiting for election day to see what happens there? the other thing is crude oil down about 67 cents to 86.42, lots of questions about what's happening in terms of the refineries and getting gasoline out to areas that have been hit hard by sandy. you can see the ten-year note is yielding 1.724%. the dollar has been stronger this morning and if you take a look right now you'll see the dollar at least at this point is, well there is the dollar index at 80.34 instead of the charts we normally look in terms of the euro. the dollar has been stronger as have many other dollars, canadian and australian dollars throughout the course of the morning. $1,708.10 an ounce for gold. the gasoline shortage has been a huge issue, it continues this morning, long lines are spilling onto the roads with many motorists waiting for hours and hours to try to fill up their tanks. sometimes having success,
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sometimes not. john hofmeister is former shell oil ceo and ceo of citizens for affordable energy. john this is a shocking situation if you're not in the middle of it, haven't been in the situation where you don't have enough gas to get to work you don't realize how bad things are. how long do you think this continues and what exactly is happening? >> becky it happens after every hurricane whether on the gulf coast, florida and unfortunately in the metropolitan area in new york. the supply siders are doing everything they know how to do. so you broaden utility crews from across the country, trying to get electricity restored, the oil companies are doing everything they can do within the limits of safety, and regulation to get supply out to the public. we also have to do something different on the demand management side. what's happening is that the demand side is descending into chaos and you see it in the gas lines. this could get to gunfire if it continues in the way it's going
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now. my recommendation is for the governors of new jersey, new york and connecticut, come together, go to an odd/even rationing plan, cut the demand in half every day by going to odd/even rationing. >> based on your driver's license or based on the -- >> based on the license plate. >> like we did back in the '70s. >> exactly. so you've cut the demand in half by definition of what numbers on your car license plate. take care of the service providers, taxi cabs, i will mow drivers, other service delivery vehicles that need gas to operate, of course take care of the emergency responders and so if you don't deal with demand management over this period until you've got electricity connected because this isn't a shortage of product in the area. this is a logistics and distribution problem and retail sale problem. the only way to correct it is to deal with the demand and
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governors are reluctant to do this. along the gulf coast, along florida i've talked to governors repeatedly, they hate the idea of telling people when they can buy gasoline because it's an unpopular choice but the alternative you're going to be carrying bodies off of floor courts i'm concerned about that and you can't put a policeman at every port so people become uncivilized under these conditions and you've got to set a policy. it makes no sense for government to start dumping product into the area say from the military storage centers because again you don't have electricity. this all will sort itself out in a week to ten days i think once you get electricity back. >> a week to ten days -- >> much longer than we were expecting. >> the thing that drove the point home is how we talk about renewable and solar and wind. we are so, so dependent on hydrocarbons it blows me away we can't get two days without it
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and we're trying to actually someday make some type of transition, and there are times when i think eh, the government, the private sector has to be behind this switch, but when something like this happens it makes me wonder, we can't wait 'til push comes to shove. maybe natural gas cars or do we need electric cars that we can power up off of a grid that gets energy from somewhere else? we are so dependent on gasoline. we haven't moved away from hydrocarbons at all. >> we do need fuel competition and i believe natural gas is a good competitor. batteries don't help you if the grid is down so you've got a problem there. if you have competition between natural gas and with flex fuel engines you could use methanol from natural gas, that would have a price impact and supply impact but of course you need the infrastructure so it doesn't happen overnight, but there are solutions here.
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>> it's still hydrocarbons, mike bloomberg won't go for that because we'll have another sandy. >> let's be clear, we're going to be dependent on hydrocarbons for the next decades, not just years, decades into the future. let's not be unrealistic. >> john, has anyone tried your idea of switching up the numbering, even/odd? have you seen that implemented anywhere? >> well, it happens in, happened in the '70s, and it worked. we haven't had dire shortages and you know what really people have to get back to is get the electricity up and the logistics will just take care of themselves. the companies know how to distribute gasoline but they can't do much if there's no electricity. they've got all the people they need, they've got all the equipment they need but they can't do things that are not safe. if they have damage they have to repair the damage at the depot before they can load trucks, but the real issue is you've got to control how many people are
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coming to that floor court getting in each other's face and becoming uncivilized in the way they deal with the fellow citizens. the way to do that is for the governors to take half of the demand every day for a period of week, ten days until we get the electricity back. >> john what makes you think seven to ten days, is that based on what pse&g has said? >> i don't know the pctio in the area but i'm just saying, whatever it is, seven to ten days, distribution will go to normal once the electricity is back on. >> okay so that's not based on anything you know that we don't know at this point. >> no. >> just watching the situation and how it's played out in the past. >> things sort themselves out in the time period, there's no more shortages once you have power. >> which has people raising questions because we have four days until election day to get there, too. john, just in terms of what this match is up to, this happens fairly routinely down in the south, just a little different this time because this is here on the east coast where maybe we're not used to dealing with
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things like this? >> you've got so many millions more people inour region, becky, than even say houston, new orleans, mobile, alabama. the number of customers you have is countless. >> john, what if we let, you know how economics works. what if we let gas prices go to wherever they needed to go? what if we let it go to $20 a gallon, $30 a gallon. >> that's terrible. >> i think that's a bad idea. >> why? >> because it hurts the poor the most. it hurts those who have the least the most. >> i know, but in a normal, that will solve supply and demand problems quickly, won't it? >> but it will create tension between the haves and have nots. >> we would never do it with tickets and now there's stubhub scalping. i know, but -- >> the solution is for the agement and you can decision on fix the problem literally
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overnight. >> there are toll lines now where you go and pay, at the airport now, i mean it's bad because it creates haves and have nots. >> but this is gasoline. >> you can go to an airport now you pay a certain amount of money go into the line where you don't have to wait with everybody else. there's people that fly on private jets still. >> in a situation where it's an emergency and a necessity. >> i know but whenever you have an artificial in any economic system where you have an artificial price where it's not what actual demand would keep it -- >> what about john's idea. >> but this is not going to be something that continues more than a week from now. >> the broader impact on the economy would be horrific i would think. if you had the market-based system buy some exxon, buy some stock. >> buy some 7-eleven stocks. >> they're worried about rioting in the streets. >> that's what john is worried about. >> john we like your idea. >> my idea. >> i like john's idea. >> for guys like you, pay $125,
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that's how you got here. surely by paying more. purely by paying more -- >> that's gouging. >> you paid the price today was. >> i'm lucky enough to be in a place where i can do that. >> he has to wait in line to get back. >> fill your tank for $500, you'd do it. you only got the zip car. >> when we come back, the ceo of cigna talks health care and quarterly results. we are counting down to the jobs report which is due out in about 50 minutes from now. also coming up at 8:40 this morning, mitt romney's economic adviser glenn hubbard will join us. "squawk" will be right back. nobody said an all-in-one had to be bulky. or that you had to print from your desk. at least, nobody said it to us. introducing the business smart inkjet all-in-one series from brother. easy to use, it's the ultimate combination
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check this out, gas is not the only thing that folks are lining up for today. what you're looking at right now are pictures of the fifth avenue apple store in new york. i can't believe this is happening but this is where the ipad mini and the next generation ipad will be on sale this morning. several apple stores do remain closed because of sandy. stores affected include soho, 14th street and grand central station but this is insane to see lines like this on a day when so many other things are happening. people, wait a day.
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crazy. >> they got money to do it, too, $349 at a minimum. >> let's get to cigna, company raised its outlook for 2012 after consolidated revenue increased to $7.4 billion. what about the rest of the health insurance industry and what will the industry look like after next tuesday's election? david cordani is president and ceo of scigna and across the board united health looked at their numbers, really good numbers for all of the hmos and most people say regardless of whether obama care comes or goes, there's going to be people that need private insurance either way. >> joe our focus has been focusing on the individual customer and partnering with physicians to improve health care and to your point regardless of the election outcome that core needs to improve health and create affordable solutions remains and our growth story reinforces that, retaining customers and expanding relationships in the u.s. as well as outside the u.s. >> someone that does that on the
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daily basis and knows how things work, i was struck by another piece in the "wall street journal" today and we were just talking about with gasoline prices as long as if it were to go to $20 a gallon there would be people that were in that line and that would pay it. but if you keep it at $4 there's going to be lines that take six hours to get through. now the thing here is called a parable of health care rationing and this is how in europe right now if you have cancer, the supply of doctors to treat cancer is so low and the demand so great you have access to it but there isn't any available so they come here. is that what we're looking at eventually, where there's so many people that are now going to be covered and there's not going to be an increase in actual providers, so the same thing is going to happen here, if you have money, you can get it? >> joe, we do business around the world, we're the larger provider of solutions for employers and governmental agencies who provide individual services around the world so we
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see a lot of models. back here in the u.s. really the most exciting part of what's changing right now is working with doctors and hospital systems to pay more based on the quality of outcomes and if they're able to align the incentives like many other businesses do, you find better quality and better value and you find thriving institutions and thriving physician practices. >> are there provisions of obama care, david, which help us get there? >> there's no impediment to it the way i look at it. so accountable care act created an opportunity -- >> this might have been something actually to try to promote a work on, right, instead of not being in the way is the best you can say about it, david? >> sure, i start with there's no impediment in the private system, started for example joe we started our first collaborative accountable care organization which is a partnership with physicians in 2008 long before this legislation. we have 42 of them up and running in the united states, spanning over 18 states today.
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now, the act itself is trying to incent some of those programs, so there's some additional movement there, but again the private system has been innovating and trying to find new solutions and the key is really to partner with physicians, and provide both information and then rewards that are based on quality of outcome, not just the volume of service. >> so at this point, and most of the key provisions aren't enforced yet for obama care but at this point obama care has not gotten in the way of private sector solutions for a lot of these cost issues. is that fair to say? will it get in the way? >> i would say broadly speaking, correct. >> it has helped but not gotten in the way. will it get in the way after 2014? >> the way we look at legislation today and we've been very consistent as a company, it's a step toward changing the health care system. it broadened access to solutions through the exchanges and the like but it is incomplete. we need to move further in terms of creating more quality and cost solutions and that's the next step.
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>> i'll go one further. the utilization is down and suddenly we're trying to figure out why, why in health care inflation is down as well. is it because of the recession that we've just been through that people are not going as frequently? because they're tying it to some provisions ofby ma care when none of it has gone into effect yet. what caused things, caused increases to slow down? >> let's quickly put that in context. it's the rate of growth has slowed down. there's more growth. it's the rate of growth has slowed down within our business, for example, the good news is we see more preventative care and more wellness services being consumed, that's a good thing. you see the rate of growth decreasing somewhat and you see it decreasing in some outpatient diagnostic services and some specialty services. >> what if obama care was rolled back, how disruptive would that be? >> to our business and our strategy, it would have a limited impact, our focus is really on services in the united states, as well as outside the
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united states, there would be some transitional changes and spli compliance rules and regulations. >> i love that, david, you know, good things happening, has it been because of it? well it hasn't really been an impediment. david, thank you, we appreciate it. >> thanks for having me this morning. >> when we come back we'll talk about the controversial call for mayor bloomberg on the marathon and we'll get the jobs number in the 8:00 hour. chances are, you're not made of money, so don't overpay for motorcycle insurance. geico, see how much you could save.
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the new york city marathon will go ahead this weekend and at this point they're saying it's going to be dedicated to the victims of sandy but that decision has come under scrutiny by the very victims it's supposed to be benefiting at this morning. brian shactman has more on the story. brian? >> reporter: becky, this is a tense story, i have to tell you. there's tragedy in staten island, real tragedy in queens, lower manhattan is an absolute mess, but yet this race is going on. people yesterday picking up their bibs, getting ready, 18-wheeled trucks up and down central park west and i think that i'll call it generator gate, because the controversy of the day will be these generators you're about to look at, two huge ones in operation to keep things going in central park, one just as big that's sitting idle just in case the other one runs out of energy, and obviously these generators could be going towards something a
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little less discretionary than the new york city marathon. the race of course nyrr trying to do something about it, launching the race to recover and pledging about $2.5 million, asking all racers to donate $26.20 to help the recovery effort. we can come back on camera, i have had thousands of runners go by me saying what country are you from? >> france. >> reporter: france, so they are oblivious to what is going on, and that is fascinating. italy, france, germany, australia, all across the world, there are foreign runners and seem to not have a clue of what's going on miles away from us. >> brian, we have gone back and forth on the set trying to figure out what it means. you do understand you want the beacon of hope for being out there. when you start reading the facebook pages for the people in staten island who are saying wait a second we're still looking for bodies a mile away from where this thing is
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supposed to launch, you think about the water and the food and the socks and things that go to the people who are going to be running this race that the victims could very well use themselves, and as you said the resources that are being diverted for this is raises tense questions. they may be oblivious now. do you think they'll continue to be oblivious as the race takes off? >> there's tons of question to address. i don't want to get into my opinion on it necessarily. i wonder if they'll get heckled when they run between queens and staten island. listen, is this something that will lift the spirits collectively of the city, i have no idea. to a lot of people i talked to, does it seem mildly inappropriate? it absolutely does and i don't want to raise a class issue either but people that come from germany, france and italy to run a race, they're not poor. they're not struggling. they're not having issues lighting and heating their home. they're here for a holiday and it just seems a little strange to me.
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look what's going on around me. >> the shots around you are the best descriptions. >> you said they're trying to raise $2.5 million, is that the profit they normally make from the marathon? is the marathon traditionally a profitable enterprise? >> i think it is for the road runners association. >> reporter: they raised over $30 million for charitable causes last year and even if they gave half of that to the relief effort i think it would be significant. they can do a lot. i think that they probably should do something dramatic. i don't know what the proceeds have been in the past. i don't think it's a for-profit endeavor, but they should give absolutely every single operating profit penny to the recovery, but you know mary whittenberg said it's not her choice. deep down i don't think they wanted to do it. i think mayor bloomberg wanted to do it. we reached out to the mayor's office, he's not doing individual interviews but i think he should address it and tell us what his thought process honestly a lot of people are angry about this.
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>> brian you make an interesting comment. you think the road runners club did not want to pursue the marathon this weekend. >> reporter: listen we talked to mary whittenberg, for my fourth business show on the nbc sports network and you saw her on the "today" show and she was on air yesterday and she sounded like she was doing what she needed to do. again i don't have that confirmed, it's not a fact but from all the people i've spoken to that seems to be the case. >> brian shactman in central park thanks for that report and it's going to be an interesting debate probably all through the weekend and even through early next week. in the meantime coming up, we've got the october jobs report, the numbers, market reaction and a breakdown of what it means for the election, and also a programming note, tonight the family of nbc networks a special event to bring people together and help the victims of hurricane sandy, tonight starting at 8:00 p.m. eastern time, "squawk" returns right after this. ♪ nespresso.
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up isn't easy, and we ought to know. we're in the business of up. everyday delta flies a quarter of million people while investing billions improving everything from booking to baggage claim. we're raising the bar on flying and tomorrow we will up it yet again. we're half an hour away from the final jobs report before the president's election. our panel of experts is here to break down the numbers. mark zandi, jaiian swonk, austan goolsbee and we'll break down
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the political consequences, the third hour of "squawk box" starts right now. welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with becky quick and andrew ross sorkin. our guest this morning is john zandi and we have a big line-up leading to the october report. diane swonk and austan goolsbee. we'll get reaction from glenn hubbard, economic adviser to the romney campaign and we're going to look at all the market moving things with the employment report trying to figure that out. we're also talking about the northeast and sandy and we have decided why do not gas stations have backup gasoline-powered generators? it's $1,000. why not require a gasoline
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station, for a gasoline generator. you might ask where can the gas station get the gas to put in the gasoline generator? from the pump! which is operating because they have the generator. >> it's not operating because there's a hole in the bucket there, henry. >> is that where it is? >> i didn't realize, they are gas stations they to get a gas powered generator because they have gas. >> but they can't get the gas out of the pump. they can't get the gas out of the pump because there's no electricit to get it out of the pump. you could get it from the generator if you turn the generator on. >> they could have a gas supply to put in the generator. all of the gas stations are closed right now, why can't they be open with a gas powered generator? >> mark zandi brought up a great point. >> this is a regulation, you require every gas -- i'm not saying it's right or wrong but throwing this back on you, you're going to have these guys -- >> that's one percent of their gouging profits per day. >> and a regulation you have to
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have a certain amount of gas in the generator just in case the power goes off and the guy in omaha will say i don't need that much gas. >> out of all of the regulations we have this is one i'm for. check the box. >> because it affects you. when the regulation affects you then you're all for it. >> okay, mr. philadelphia suburbs, how are things affecting you? you were able to come here. nobody has gas in new jersey because the gas stations, they have no power. >> hey, i'm sympathetic to your argument but i'm playing you. i'm playing you. >> this is true it's a huge issue today, it is our top story. the northeast is still struck by everything that's happened from the devastation of sandy. as we've been talking about, there are still an estimated 4.5 million customers without power, those power outages adding to pressures at the pump. drivers have been battling two, three, four-hour lines and longer. >> guns, fights. >> once you get to the top you
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may ask for $50 or fill up the tank they'll say we're rationing, it's only $20. >> or they run out by the time you get there. >> john hofmeister had a great idea maybe you go back to saying you can only buy on alternate days whether your license plate ends with an odd or even number but someone on twitter said what about the people standing in line with their gas cans hoping to get gas for their generators? we have better news from new york. con ed saying most manhattan residents will have power restored by tomorrow, i don't know how they'll do that in lower manhattan but this is what they're saying, we'll get an update on traffic and public transit systems in a few minutes. cnbc's jackie deangelis will bring us the latest on a growing problem, food shortages, and now there's this talk of a potential nor'easter that will come late tuesday night next week has a lot of people worried, too. take a look at another picture, you'll see more lines taking place.
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guess what, this situation where you don't see quite the lines we saw a few minutes ago. >> right to the right. >> earlier we saw people lined up to buy apple's ipad mini, stores must have just opened, it hit stores in two dozen countries today. already lines at the apple stores across asia have been smaller than with previous product launches. the ipad mini costs $329 for a wifi only version, more expensive than the kindle fire but less expensive than the larger ipad. let's get a check on the markets. u.s. equity futures have been paused, waiting to see what happens with the big number we expect at 8:30, the jobs report. the dow futures are down by about 6.5 points but the s&p and nasdaq futures are slightly higher. overseas in asia overnight you see that there were green arrows across the board in korea thes could pi was up by 1.4% and you had gains of better than 1% for the hang seng in hong kong and the nikkei in japan in and
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europe at this hour, take a look right now and you'll see they're mirroring what our futures are doing, a wait and see attitude, see what happens at 8:30. >> the other big news of the morning as becky has been discussing all day, it is jobs friday and today's all important employment report falls four days before voters join us from the polls. austan gallooolsbee joins us an mark zandi. austan, what is your number, sir. >> for which side? employment around 130 tncht. on the unemployment rate, you got two things going opposite ways, one we had such a big drop last month, you probably expect some bounce back, but i actually think the economy has gotten better than a lot of people think, and -- >> ooh, that's a change, austan. >> i think it actually ticks down a tenth. >> going down to 7.7? >> that's what i think. >> austan you used to be a
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little bit more bearish. >> i was. we crossed that hump, one of my bearishness was rooted in, we had the weird seasonal adjustment that the summers and the springs are worse than the falls and winters have been better and now i think we're on the other side of that and i think growth has ticked up a little bit. >> austan, where would you put the u6? i'm sure people will make something of that number as well. >> i think you know that i'm on the border between unemployment ticks down a tenth or stays the same. if you look at the u6, i think it's about the same kind of range, kick down a tenth or stay the same. >> austan i talked about you earlier, when you were on, was it earlier this week and you are talking about this report saying the last report was so good, such a positive report and then i point out, i said back when it came out, 114,000 was below what people were looking for, and you did have that drop from 8.1 to 7.8, but the actual number of
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jobs it was a horrible report. it was weird. i thought you were spinning it as a great report and which you normally don't spin. >> no, i wasn't trying to spin it. the unemployment rate -- >> is 114 tncht a pagood report? zandi said it was a bad report. >> i didn't say it was a bad report. >> my point is we have two surveys, one was extremely positive, way outlier positive -- >> wasn't it part-time. >> i wasn't trying to spin you. >> austan, wasn't it part-time jobs? >> joe, there were other things in that report. >> some of it is part-time i'm not disputing that. >> 114,000 is not strong. >> remember we had big upward revisions to the previous two months and hours worked increased. remember that? that's another big and average hour earnings were positive. you take the totality of the report it was a good report. >> i'm definitely not a spinner, i tell it to you straight and the previous months.
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guys are saying these will stink and a lot of months weren't that good. >> austan in the last hour we talked about wlafr this jobs number is whether it will have any impact on the election, your thoughts? >> only if it's a real extreme. 2004 is probably the last time we were in a situation like this where we had some weak reports and very last report came in pretty strong, and i don't even think that did very much. so unless it's an outlier, i do think w think because they're not paying attention or they're taking longer averages, i think most people that are voters are, this number doesn't make that big of a difference. >> hold on for one sec. . we want to brink diane swonk. what is your number? >> looking for 140,000, private 138,000 on the total and 7.9%. >> 7.9. okay so you go to 7.9, why?
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austan is going to 7.7 here. >> you know, it could go either way and really the participation rate i think there's cross-currents. we have people retiring out, both at 62, which is a sign of stress and at 65, those 1947 baby boomers hitting us, that's about a percent of the decline and participation rate since 2000 is the baby boomers. i'd love to see more people throwing their hat in the ring but it's not clear if they'll see it or not. i'd love to see more people throwing their hat in the ring on the participation rate. >> the key question, diane did my adp numbers sway you at all? >> now that you're adp numbers, mark, of course. >> good. i feel better. >> actually i had that number before the adp report but you didn't make me move. how's that? >> we were talking yesterday when mark came in with the new adp report. don't say a word. >> okay. it's hard for me to do. >> i know, but how is that, is this number going to change your view, do you think, going into
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friday? >> again it has some of the same qualities. i understand you've added more data and more employers, thank you, that's great. mark, i want to give you kudos for that. jo joel prackin is a friend of mine as well. this is a revision and helps us get an idea of where the economy is but doesn't give us the best number on the initial employment report and financial markets have had a hard time dealing with this number in the past because it's great on recessions but not great on the first cut. >> but that's interesting you're saying it's actually a better indicator of what's happening with the economy within the number we're going to be focusing on today but traders look at this jobs number today and that will be important to the markets? >> i think that's, unfortunately i think that's a reality, it's not unfortunate for mark, it's fortunate for mark because you want to have the best information. >> diane we can do this together. let's just educate the world. >> we'll be in washington next week together so we can talk more about it. i really value the statistics,
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the quality of the statistics but the important point is getting the best quality statistics and this number has access to things the federal government doesn't right now. >> i have a question on this. if mark comes in on our jobs day discussion and wields the adp report as if it backs up what he's saying, is that unfair? >> i've already pointed that out. >> oh, yes. >> stinks to high heaven, austan. >> cuts both ways. >> i'm on the line here. >> he's not a normal participant. he's got way too much inside info now. >> because it's a third revision, you know, austan, i think it's still good. >> there's no prize for being right. if it was we'd have omonitor it more closely. i don't think he's eligible for prizes. >> i'll agree with you on that. there is no prize. >> austan, diane and mark will stick with us for the report as we get it at :30. >> couple points, number one because of the flammability of fuel, the wiring is higher at a
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gas station to be able to hook a generator up so it would be more expensive than $1,000, probably $15,000. >> that's a lot. >> mr. regulation here, bloomberg can regulate every 16 ounce soda so tea makers at 16.9 ounce bottles, the coffee people don't know what to do. he can't get two gas stations the two that are in manhattan to get a generator? he's concerned with climate change. >> i'm concerned with the free markets. if you're a big enough gas station you'll make it back. the ones who are open are making three times the sales. let the free market take over. >> some regulation is okay. >> i'm talking about -- >> free market should make it so a lot of guys do buy it. >> so they'll sell more next time, maybe you're right. maybe there's a free market solution. coming up we're getting closer to 8:30 a.m. in the october report. you're looking live at me but
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now you're looking live at a clock that's showing you what time it is at the labor department. probably similar to your clock. >> this is accurate. >> you can reset it, there's a delay for people watching if anyone is watching. economists expect payrolls to increase 125,000 compared to 114,000 the previous month and i'm looking for 7.5. >> i'm looking for 8. i'm going to be closer i bet. >> i'm with becky. >> if you go over, "the price is right." >> i'm 7.6. an update on this -- >> bob barker, what do you have to say? >> and it's a three-word storm, it has been dubbed superstorm -- >> you can't call it a hurricane because maryland, new jersey and new york said you can't do the deductible. ll-in-one had to be bulky. or that you had to print from your desk.
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welcome back to "squawk box" everyone. superstorm sandy still disrupting power, traffic and public transit in the northeast. our courtney reagan joins us with an update on the situation and courtney, seems to be changing on an hour by hour basis. >> that's exactly right. we'll continue to get the updates and the numbers will change. we're starting to see the number of people without power come down in a big way, but as of
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this morning, there are still 3.5 million customers in the dark. it's going to get particularly tough for those folks this weekend with cold weather forecast to move into the northeast. new jersey remains the hardest hit state accounting for more than 1.5 million of the outages. as gas stations come back online pressure at the pump should start to ease. the drivers are still battling two-hour linds lines. con edison says most manhattan residents will have power restored saturday. commuters can expect more traffic jams as hov restrictions in place. the holland tunnel is open at this hour but only to buses. the mta is getting more subway service up and running today and the northeast corridor is the only new jersey transit line running into new york city from new jersey. becky? >> courtney, thank you very much. appreciate it. we'll see you back here in a little bit. >> these gas shortages and power
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outages aren't the only problems residents are facing in the northeast. jackie deangelis joins us with food shortages in some of the hardest hit areas. that's t worse than gas, right, jackie in. >> reporter: exactly. good morning, joe. as you said the gas lines as i was driving to the supermarket are very, very deep as people were waiting for that resource but food is an important resource, too. although a lot of people stocked up before the storm they're running out in their houses and having to come out to the stores. the question is do the stores have the supply to deliver the needs throughout this aftermath of superstorm sandy? we're here at a kings in hillsdale, new jersey, they've got 25 stores, all stores are open, eight of them are being powered by generators that run on diesel fuel. this store that we're in right now never lost its fuel and the manager was telling me the
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strategy for this was really important. they had to bulk up on their generators, they bulked up on their orders ahead of the storm and right now in terms of deliveries it's pretty much hit and miss. they're waiting for bread delivery, produce, dairy, also meat and some of those supplies of course are more in demand than others because people can't take items home that they can't refrigeraton ice is another big one as well. behind me in the bread aisle the stock is running a little bit low but they are getting a delivery, they just stocked the shelves a little bit here. other stores haven't been as lucky. we were in some stores just last night that had their power cut off, they did not have generator power and their produce aisles were completely empty and also those non-perishable items were starting to sell out. they also couldn't process credit card charges which was making it hard for some of the customers to be able to fulfill their orders. at the same time as courtney mentioned add insult to injury we have another potential storm coming along the way and we've got a lot of shoppers who told us they're just tired of this
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already. there's battle fatigue going on. the hope is that the deliveries will continue and food supplies will be available but the question is, how much longer can this go on. >> that's what we've been wondering ourselves, jackie, trying to figure out exactly what this means. it's interesting, you pointed out we were talking about how every one of us has seen kings, the only one open. we'll try to figure out what it will means for sales for them. >> reporter: that's right. they were first the first couple of days when nobody else had power a lot of customers come to the store. some of the others have been getting power, that's changed a little bit but they said the interesting thing is the kind of demand and the items that people are looking for, as they mentioned bread, et cetera, but snack sales are through the roof, soda sales are through the roof. >> if you don't have a refrigerator at home and don't have power you need something that's not going to go bad. >> jackie dun dunkin' donuts no
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coffee and bagel place no coffee, went to kings but there were 60 people in line so we didn't get coffee which is why you ought to be able to buy a cup for $20. >> i'm okay with that for coffee but not okay with that for gasoline. everybody needs gasoline. >> you remember nixon and wage price control. it's not gouging. it's what i'm willing to pay and talk about you who paid $125 for a taxi today. you're a big shot you can buy a $20 coffee. >> i don't think you were gouged. >> reporter: listen guys, they're not charging $20 a cup here and this is one of the more fun assignments because the manager did tell us they have hot chocolate and coffee and doughnuts and we're welcome to whatever we need. >> if i'm willing to pay 20 why can't i get to where there's only two people in line. >> you can't for essential items everyone needs to share. >> that's utility. >> supermarkets are utilities at
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some level, right? >> i guess, okay. i'm just channeling you. i wouldn't pay that kind of money. >> but you think i would. >> the guy who has a sweater. how much did that sweater cost seriously? >> i have no idea. >> $1,000 easily. >> i will check and maybe we'll put it on ebay for a good cause, how about that? coming up, the clock is ticking, we're going to get the october jobs report at 8:30 a.m. eastern, before the numbers come out we'll get final predictions from our panel of experts and after the report reaction from glenn hubbard, economic adviser to the mitt romney campaign and some people speculating he could become the next treasury secretary or the next federal reserve chairman. and save your. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. he'll start investing early, he'll find some good people to help guide him, and he'll set money aside from his first day of work
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welcome back to "squawk box." we're going to be watching shares of linkedin, reporting earnings of 22 cents a share when you exclude certain items, twice what analysts had been expecting, they were only looking for 11 cents. revenue of $252 million beat expectations, up 81% year over year. shares of linkedin as you can see up just over 8.3%. aig reporting third quarter profit that beat forecasts after posting a nearly $4 billion net loss a year ago. the company saw improvement across all of its insurance businesses and ceo tells cnbc aig's offices in lower manhattan
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including its headquarters were without power because of hurricane sandy but the company operated without interruption. it's too early to estimate the financial impact of the storm. we're getting a lot of these assessments and will continue to update as we get them. when we come back we're a couple minutes away from the october employment report. the final jobs number before the presidential election and one the markets are watching closely. ahead of the numbers, the u.s. equity futures have barely budged. markets are waiting to see what happens with this number, dow futures down by 7.5 points, the s&p and nasdaq futures are slightly higher. "squawk" will be right back. if you think running a restaurant is hard, try running four. fortunately we've got ink. it gives us 5x the rewards on our internet, phone charges and cable, plus at office supply stores. rewards we put right back into our business. this is the only thing we've ever wanted to do and ink helps us do it. make your mark with ink from chas
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welcome back to "squawk box." we are a few seconds away from the november jobs report, the last report before election day. we have austan goolsbee, diane swonk and mark zandi standing by to analyze the numbers as they hit. rick santelli joins us from the cme to give us the markets immediate reaction and steve liesman is on set as he is every month. aed has of the numbers we've been watching the futures and the market has been hanging on at this point, barely budging because this could really drive the way things are going to be trading today. you see right now the dow futures actually all of the
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futures are modestly positive at this point, only by a couple of points. the numbers are expected to be 125k and 7.9. let's get to hampton pearson. >> up 171,000, october non-farm payrolls increased by 171,000 jobs, the unemployment rate 7.9%, no change in average hourly earnings. private sector job growth in october plus 184,000. we had significant revisions for august and september, an additional 50,000 jobs were added to the august number, an additional 34,000 for september, doing the math, an additional 84,000 jobs than were previously reported added to payle rohs over the previous two months. job growth across the board, professional and business services up 51,000, health care plus 31,000, retail adding 36,000, leisure and hospitality, 28,000. the most significant downward loss of jobs last month it was
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government both at the federal, state and local level, minus 13,000, about half of that at the state level. the labor force last month actually increased by 578,000, the participation rate 63.8%, that's up 0.2 from the previous month, total employment increase by 410,000. there are now 12.3 million unemployed, 5 million six months or longer, 40.6%. back to you guys. >> all right, hampton, thank you very much. >> wow. >> let's get to our panel for reaction and steve real quickly? >> pretty solid report. 184 on private, but i just looked down the line at positives at every major sector was positive except for government, which was minus 13. so we still withstood that, that's why you got that lower overall number, the revisions to prior months were better and maybe explain a little bit more about the declining unemployment rate and i think it's good we held onto the bulk of that gain, two-thirds of it, looking at the
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household survey you had gains of 578,000 in the workforce, people came into the workforce they found jobs 170,000 more were unemployed so you know the household survey kind of confirming what's going on, a lot of big swings in there. overall the total measure of labor came down by a tick, 14.6. that was unchanged last month, that came down overall. >> it helps explain last month's numbers? >> given what that number is, it will debate what the number needs to be now. put in context what joe talked about in the 7:00 hour. what is the new normal? what's good here? okay? we should be doing 300. >> maybe not. maybe not. >> i'll take 150. it's good enough to maybe bring down the unemployment rate a little bit but it ain't great given how many people are out there. >> this is zandi and his adp thing. >> that's right. >> wait a second, let's be careful. mark said he's predicting the second revision.
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>> that's true. >> this is the first print. >> i can feel the gloat from here. >> i'm feeling good. the reason i feel good is this is a great report. think about the number. >> it's not a great report, come on. easy. >> 300 is a great report. 148 in the context of the number of unemployed americans is not a great report. >> austan thought 114 was great, this is 170, this must be superlative austan. >> what are you talking about? >> earlier this week i asked you, you said it was a really good report. >> i said the unemployment rate was great. i said the unemployment rate part was great. >> spin it. >> rick talk about the market's reaction to it. we did see modest gains but maybe not a sharp reaction from the market. >> you didn't see a sharp reaction in the preopening equities but a lot of times in the employment report you wait until the full opening at 9:30
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but nonetheless we're up about 35 points now on the preopening, up about six basis points, about five basis points on a ten-year note yield and i wish you would have came to me before the number because 7.9, i didn't call it one month ago, i'd call it two months ago. you know what, joe, i want to you listen to this in particular. >> i got this one. >> joe, this is a great day. i'll tell you, the current administration really ought to celebrate today, because of outside of revisions, coming in today from the entire term of this administration from february '09 to today, they came in on the establishment survey down 61,000. >> you're wrong, rick. >> with revisions -- believe me, i added it up four times. >> you're missing the 380 they're adding for the benchmark revisions but that's okay. >> you know what? i am not wrong. you want to do the math? you want to bet. >> i do the math all the time. >> don't tell me we left out the
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revisions. net job creation is in positive territory, the friday before tuesday, and without the revisions, you go to the bureau of labor statistics you add up february '09 through last month, you get minus 61,000. >> but the reality is, rick, there is a benchmark. >> that is the reality. i'm a numbers guy. you guys can spin your reality. >> we're back to picking the numbers. >> continue the release where the government said there's 380,000 additional jobs in the bench mark revision march 2012. >> diane, what do you think? >> bls website, february to last month. >> rick better to be quiet now. >> you, not me. >> actually, what i'm looking at is one of the things, one of the upward verevisions are importan and the increase in participation rate, more hope out there and it is consistent with some of the consumer confidence numbers and illustrates the break we've seen, consumers have been saying we've got more jobs, feeling
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better about the economy, housing prices are coming back but corporations are still being somewhat hesitant. we're not getting the 300,000 we'd like to see and you're still seeing the dpap gap of a race, the consumer is feeling a little better. it's not hard off the benchmarks we've been coming from but the corporate sector is not hiring up like crazy but certainly we have to welcome these numbers. i also think the industry issue on the hours that steve, you've got the hours worked and the hourly earnings. that was not as strong of a number. >> that was a weakness in the report. the average 34.4, is that all workers? hold on that's all private non-farm workers so unchanged and earnings per hour unchanged as well. so that's a weakness. >> which is the tension between the corporate and the consumer sector. the good news is we're seeing food news for consumers, this validates a lot of what we've seen consumers saying and the housing price movement is a game
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changer for consumers, the biggest wealth effect out there and we've been getting more jobs and this confirms that but of course it's not enough to be the big mover and steve you made the point, 300,000 really is where we want to be relative to where we were last spring, this is much better. i'm surprised we got manufacturing in this as well because that had been going the other direction and even in your report, mark, you had the adp down on manufacturing and i'm wondering if some of the weak innocence hourly earnings is not as many hours in the manufacturing sector. >> rick n a perfect world, in a perfect conspiracy world you would not let it end at 7.9, because you came into office and we checked and it was 7.8. >> over. >> so after all is said and done the unemployment rate is actually higher than it was on inauguration day in 2009. so that would have been, maybe axelrod didn't look closely enough where it was in '09 because that's off by a tenth of a point. we thought it was 7.9, too, earlier.
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but it was 7.8 in january. >> 8.3 in february, 7.8 in january. >> the day he was inaugurated it was probably 8.1. >> if you were romney would you say it's up. it's above where it was. >> remember that, 0.2%, plus or minus 0.2 on confidence interval which means 7.9 is not different from 8.1 or 7.7. >> austan i have a question for you. now we're saying the job numbers seem okay, you get more optimistic but you look at the investment numbers they're looking weak. >> terrible. >> advertising, how do you explain this seeming discrepancy between what businesses are doing or do you have a sense of that? >> are you asking me? >> i'm asking you, austan. >> sorry. what i think is on the investment side, the puzzle is compounded by the fact that the tax code is basically never been more favorable to investment than it is right now. so you would think everybody would be trying to get their investment in. i think there's a lot of
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uncertainty about what's going to happen with the fiscal cliff and i think the u.s. despite our modest growth rate is about the fastest growing country in the advanced world. i think there's a lot of question, do we actually need the extra capacity yet. so i think it's going to be still a little bumpy on that. >> we have to agree, given those investment numbers, it has to be, make you pessimistic about job growth because usually capex and job growth go hand in glove and that's not been the case. >> historically you're right -- it shall. >> it makes you pessimistic about future productivity as well. >> i can -- >> it's historically right but the last couple of months it hasn't, more than the last couple of months, over the last year, year and a half you've seen rebound of investment even though the job market wasn't improving that great and now i think you're starting to get a little of thely. side. >> can i ask anybody, the participation rate going up, what exactly does that mean and how do we read that? >> it means that the decline in the unemployment rate below 7.9
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is increasingly real. >> people are putting their hat in the ring and looking for jobs. >> that's good news. that's a hope setter. >> we've been waiting for a world where we're doing 200,000 and 300,000 jobs a month and the unemployment rate is rising because we're bringing people back into the workforce but the number of jobs we're able to give them is not sufficient so people who are raising their hands -- >> the household employment number increased by about, employment. >> a strong month. >> i hate to be sort of statistical on this but statistics have been questioned a lot in the house hold survey 400,000 plus or minus is within the range of statistical significance. >> nonetheless we get much stronger household employment growth. >> i just want to point out that these guys give us -- >> remember, that's where the small business and the startups show up first. >> the self-employed show up and the two numbers do converge over
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time. >> let's talk about the future here. let's figure out what we know now. we know a couple things. these numbers do not include hurricane sandy and the effects in the labor department, we knew that anyway. what can we expect next month and how do we start to think about where the economy is right now, given what this job number tells us? zandi? >> we're creating 150,000 per month. >> ifs a'a conspiracy that's the one. >> between sandy and the election and the cliff. >> sandy and zandi. >> i don't think sandy will be that significant effect on the employment. >> it's a 2% economy in. >> 2%, 2.5% gdp growth. >> i think we're going to see -- >> we'll wait until next wednesday morning. >> i think mark would agree with this, it was about an year early on the call but i agree with him now f we're going to see an upside next year it will be in housing and i think sandy had
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multiplier effects on housing, as people do repairs they're doing renovations and we also have the distortions will be interesting in november depending on how long restaurant workers and people like that are left out of work and whether they fall in hours worked, it will be affected in the november numbers but there's the overtime of all the emergency workers, the construction workers coming to repair, everyone i know from illinois is trying to get to the east coast to help you guys out and take advantage of the government funds that are coming in to help rebuild the infrastructure so i do think there will be some distortions in the numbers and the question is, whether they net out. i think we'll get a net positive eventually from sandy. we got a big positive out of hurricane andrew. katrina was really the only disaster that had no stimulus effect to the economy. it's because people moved, closed down and left the area entirely. >> diane, rick, austan, steve, thank you very much for your help. we appreciate it. mark will stay with us for the rest of the show. >> bizarrely, i've been watching
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intrade going on, romney's chances went up from 33.4 to 33.7, i don't know if it's significant, and obama's chances wents down. >> joe, he went on the -- >> for $7,000 you can move it a point. >> a heck of a lot cheaper than a campaign ad. >> you can't watch it. if you wanted a reason you'd say because now it's above where it was when he took office the unemployment rate. >> gold, dennis gartman is breaking below $1,700, down more than $20 right now. shows you there's something disinflationary in the numbers. >> some people might not know who the president is wednesday morning because you don't have power to turn on the frickin' tv. maybe there will be a president and we just don't know. chevron company reporting earnings of $2.69, lower than estimates of $2.83, that analysts expected. revenue looks below expectations. exxon had a great number because of refining margins so i don't know why this would be below.
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hopefully we looked apples to apples. >> coming up we've got the jobs effect on next week's presidential election, up next we'll talk to glenn hubbard, economic adviser to the romney campaign and dean of the columbia business school to get his thoughts on the number.
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welcome back to "squawk box." lets aget to the jobs report and
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the political impact of the employment numbers. joining us now columbia business school dean and romney campaign economic advicer glenn hubbard. glenn, good to see you. >> good morning. >> thanks. in addition to it being a pretty good overall number, the 170 number this month some people are saying the revisions to last month do show a pick-up in something. is it the housing market that came around? is it a good number? >> well i think that our expectations may be dumbed down a bit. it's consistent with about 2% gdp growth and we have had about 150,000 jobs a month on average this year and last year, which is roughly speaking read itting water in the labor market, and the median duration of unemployment remains elevated. really vigorous recovery is a number like 250,000 to 300,000 jobs a month. this is simply not good enough. >> we've been, and liesman, you're leaving, but we've
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decided that to lower the unemployment rate you no longer need 300. why did we decide it's a smaller number? liesman where is your mike? >> because the population growth is lower and you also have the aging of baby boomers and discouraged workers lowers it as well. >> that's true but remember a vigorous recovery would be in the 250 to 300,000. >> i'm not excited about 170. >> what happens when the construction cycle kicks in. so far housing hasn't been a contributor, it's been a dead weight on the economy. that's a lot of jobs, right, glenn? if we were getting 150k now without a construction sector what are we going to get when housing kicks in 6, 12 months down the road? >> housing could make positive contributions but i think it's very unlikely until we resolve a lot of the policy uncertainty that hangs over a lot of house holds as it does business. housing could be a contributor, good housing policy would help. we have 23 million americans
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struggling and high levels of long-term joblessness, the key is to get growth up. >> what would be your -- under a romney presidency what would be the big shift on housing in terms of policy? >> well the first step is to stop the policy uncertainty surrounding the budget which i think i heard austan goolsbee in refer to in your previous segment, that's a very big deal. the second would be to affirm a good long-term housing policy that would help people get mortgages at current low rates and move the housing sector forward. >> what would that policy be, though? >> well we first have to reform our system of housing finance to get private capital back in and we've got to make sure that households don't fear very large future tax increases which of course they currently do. >> glenn, you had this proposal, very nice, good proposal about mortgage rate financing and i haven't heard that in the campaign. are you still supportive of the idea of try ig to facilitate
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more mortgage refinancing? >> i believe it would be a stimulus for the economy, yes. currently the administration plans and the gses have frustrated that but, yes, i think it would be positive. >> you advised the romney campaign, obviously, on policy. you probably don't advise them on how to campaign, i guess, glenn. is that the story, that was where it was in january and we sit at 7,900 and we're still above where we started? >> those are all good talking points. the way i put it to people, as i said before, you have 23 million americans struggling and looking to participate more in this labor market and we have a jobs gap of more than 8 million from what the president promised in his first forecast from where we are mao. that's not a great record. >> glenn hubbard, thanks for your immediate appraisal of the report. we appreciate it. all right. a programming note.
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watch "squawk on the street" for reaction to the jobs report from alan krueger, chairman of the council of economic advisers for the president. when we come back, we will have more reaction to the jobs report. the last trading session of an unusual week on wall street. we'll check in with jim cramer after this. tonight on the family of nbc networks, we have a very special event to bring people together and help the victims of hurricane sandy at 8:00 p.m. eastern time. this is a huge concert. a lot of huge names including springsteen, bon jovi.
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welcome back to "squawk box." in our headlines the october report, 171,000 jobs were added last month. the unemployment rate, though, ticked higher to 7.9%. chevron reported below expectations earning $5.3 billion in this quarter, $7.8 billion in the year ago period and that's $2.5 billion less. they do talk about lower
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production was the reason. oil and gas production dropped. exxon was helped by much better refining margins by beating expectations. that's not the case with chevron. >> if they had been effectively gouging people they would have done better. >> if you're not effectively gouging, you blame managers for not knowing how to do it well, don't you? when we come back, we'll give our guest host, mark sandy, the last word. monday on "squawk box" the election homestretch. we'll handicap the presidential race and the market's expectations. our guest host master of management jack welch. he'll sound off on politics and jobs. with the fidelity stock screener, you can try strategies from independent experts and see what criteria they use. such as a 5% yield on dividend-paying stocks.
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take a look at shares of verizon, the stock is trading lower. there are just a few points hitting on the headlines here. one says that verizon is saying the impact of sandy fourth quarter could be significant. i'm not sure where those hits are coming from. there are wire flashes but i've not seen a press release.
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thank you. i'm talking to verizon right now, the spokesman, telling us this is out. what else can you it tell us? >> you just got a dropped call. >> okay. but the sandy impact could be significant for the fourth quarter. peter, thank you. >> i'm glad you didn't have a dropped call during that from verizon. let's get back to our guest host, mark, you get the last word. you said something during the break, the idea you think the next couple of months -- >> the next 3- months. i'm really nervous. we have big fiscal issues we are not going to nail down without some brinksmanship. we're on the same page. >> all the